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Sunday, January 28, 2018

"Make the Rich Pay" -- The Rich

The rich tend to be on the political left.

Have you noticed?

Sure, you have heard about “the Koch brothers.” Or Conrad Black. But they are the exception. Conrad Black was one big newspaper proprietor who was on the right. He made news because of this. How many newspapers are on the right? Apparently, the owners of all the others are on the left. Rupert Murdoch makes news for running a TV network on the right. But this was also a huge profit opportunity, precisely because most media are strongly on the left, and a customer base was not being served. Other proprietors were so strongly on the left that they were prepared to let their businesses suffer for the sake of their politics.

Pick a posh neighbourhood in the US or Canada. Odds are, it votes left. Westmount—Liberal. Outremont—NDP. Rosedale—Liberal. Vancouver Quadra—Liberal.

The left claims to be “for the poor.” It is really for the rich. The poor in the last US election seem to have mostly voted for Trump. Not that the right is necessarily for the poor—but they do not make this their banner slogan, either.

This is how that works.

Everyone who has more money than they really need sees poorer people and, even if they do not feel a tad guilty about this, they at least fear envy. So there is always a market for some scheme that will “help the poor.” This allows the rich to point for vindication of their own wealth to the fact that they have publicly supported such schemes. They are “progressives.” It’s a less painful alternative to the alternative of either actually, personally, giving money to the poor, or admitting they are a little selfish for not doing so.

Not, let us note, that there is any positive moral obligation to give money to the poor. But that is a separate and more complicated argument. People do feel guilty, and do experience envy.

The standard and most popular tactic among politicians, to meet this client need, is to conjure up an imaginary class of “rich capitalists” whose responsibility it is to divest their wealth for the sake of the poor, and not us, we poor people in Rosedale or Outremont. After all, they have more money than we do.

No matter how rich you actually are, this is necessarily always true. You can always pass the buck up the chain to someone who has more and is not doing their share. Everyone can use the same logic, and make the same claim, all the way up to the one last person who actually is the richest soul in the land, or the world. “Why should I be giving up what I have? After all, Warren Buffet has more. Take his money first.”

But even at the very top, a lot of the madly rich, like the magnates in Silicon Valley, are also on the left. You can find all kinds of them calling for higher taxes—obviously on themselves.

“Heck, I’m for helping the poor. I’m not greedy. I think we should all pay more taxes.”

This works for the really rich, too, who cannot fool themselves into believing they will not bear the higher taxes. They are passing the buck back down the line, in effect. You think he should pay instead of you. He says he’ll pay if you pay too. The positions are actually contradictory, but both on the left. They both come out as “the rich should pay more taxes.”

There are other considerations. It is naive, in the end, to imagine that money going to government goes to the poor. Most of it, of course, goes into the pockets of bureaucrats, and bureaucrats can be among the very rich. Indeed, just about all of the richest neighbourhoods in the US are in the suburbs of Washington D.C.. Guess who lives there (and guess how they vote). Even money specifically earmarked in budgets for the poor goes, apparently, 70% on administration costs—to bureaucrats—and only 30% to the poor. The figures are reversed, on average, for private charities.

At the same time, big government is to the advantage of those who are now rich. More regulation restricts competition. More corporate welfare is available, more fat contracts are put out to tender for established businesses. There is no reason for a big business to prefer a free market.